JOHANNESBURG - Imperial Holdings anticipates the unbundling and separate listing of its motor business from its logistics business to occur in the fourth quarter of this year and that only a massive stock market crash could delay it.

Mohammed Akoojee, the acting chief executive of Imperial Holdings, said yesterday that there was nothing under the group's control that could derail the unbundling.

Akoojee said the unbundling of Motus, Imperial’s motor business, and its separate listing on the main board of the JSE was still subject to approval by shareholders at a general meeting on October 30.

On unbundling, Imperial Holdings would be renamed Imperial Logistics.

Akoojee said there had not been any pushback on the strategy from major shareholders, although there were some people that believed the scale of the group's balance sheet was “a strategic value-add”.

However, Akoojee said that when they went through the strategic rationale with them, they were able to see the individual businesses had been given a very good starting point in terms of their capital structures and what they had done in the logistics business to make it more asset-light and more cash flow generative.

“They then understand they are self-sustaining from a balance sheet perspective.

“There are pros and cons and you have to balance what is right in the context of both these businesses. But we as a management team are not going to risk an unsuccessful unbundling.

“Where they (unbundlings) go wrong is if you start businesses off on the wrong footing,” he said.

Akoojee said that if a major shareholder in Imperial was unhappy with the unbundling, they would have disposed of their shares in the company, but Imperial Holdings’ share register had been very stable for the past 12 months.

Based on this and the discussions they had had with major shareholders, they did not foresee any problems in getting shareholder approval for the unbundling, he added.

Akoojee said Imperial had appointed JP Morgan and Commerzbank as the lead arrangers and underwriters of the transaction and the international debt facilities and Standard Bank and Nedbank as the lead arrangers and providers of local facilities.

“We have effectively placed the debt between the four banks, but we do see that it's important to have some tension in the process for firm-up on pricing and to have a more diversified funding profile and not just be reliant on four banks. That is why we are doing the debt syndication,” he said.

Imperial yesterday reported solid financial results in the year to June, which it attributed to acquisitions, increased vehicle sales, a good performance from Motus and satisfactory performance from Imperial Logistics in mixed trading conditions.

Headline earnings a share grew by 27percent to 1570cents from 1390c.

Revenue rose by 11percent to R128.7billion from R115.9bn.

Operating profit increased by 6percent to R6.4bn from R6bn despite a deterioration in the operating margin to 5 percent from 5.2 percent.

Akoojee attributed this largely to a change in the vehicle sales mix and reduction in sales of luxury brands in favour of smaller, lower margin entry-level vehicles.

The dividend a share for the full year increased by 7 percent to 710c from 650c.

Shares in Imperial rose 1.5percent to close at R201.31 on the JSE yesterday.